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(Telegraph) – THE PAYMENTS COUNCIL has voted in favour of abolishing the use of cheques as a means of payment.

The Payments Council Board has agreed to set a target date of 31st October 2018 to close the central cheque clearing system.

Although cheque use has been in decline since 1990, and has fallen by 40 per cent over the last five years, there are still plenty of situations where cheques are used extensively.

The Payments Council said that over the next nine years it will seek to promote and explain existing alternatives; and where innovation and new options are required to ensure that they are put in place.

It said that the payments industry has to rise to the challenge of finding easy-to-use efficient alternatives for these payments and to ensure that they are easily accessible and well understood by cheque users. The goal is to ensure that by 2018 there is no scenario where customers, individuals or businesses, still need to use a cheque.

Chief Executive of the Payments Council, Paul Smee said: “Customers aren’t likely to see any immediate change as the target date is still a long way off. This announcement marks the start of extensive work that we need to do to ensure that everyone has a viable alternative, should the cheque clearing close.

“We aim to be very transparent and we will continue to consult fully with all interested parties. There will be a critical review in 2016 when the Payments Council will decide whether sufficient change has occurred against agreed published criteria, to press ahead to do away with the cheque in 2018.”

The move is likely to anger many people, charities warned, particularly older people who tend to prefer cheques to plastic cards and who are less likely to use online banking to do electronic transfers.

Age Concern and Help the Aged, said that many older people rely on cheques as their main form of payment and will be very worried about how they will manage if they are withdrawn.

“Without cheques, we are very concerned people will be forced to keep large amounts of cash in their home, leaving them vulnerable to theft and financial abuse,” the Charities spokesman added.

Meanwhile, Cheadle MP Mark Hunter has launched a cross-party campaign, backed by leading consumer group Which? and business organisation Federation of Small Businesses (FSB), to “save the cheque”.

Mr Hunter said the decision will have a devastating affect on the most vulnerable people in Britain – elderly, disabled and housebound people who rely on cheques as a means of payment. It will also have a knock on effect on the economy, creating difficulties for thousands of businesses.

Mr Hunter recently tabled a cross-party Parliamentary motion which has collected the signatures of over 60 MPs from all parties – including that of Vince Cable.

Mr Hunter said:”Abolishing the cheque will cause great inconvenience to many people who rely on cheques as a means of payment – particularly many elderly people.

“This development is most unwelcome in its own right but taken together with the recent news on bank charges I think they amount to nothing less than a two-fingered gesture to the British public.”

Stephen Alambritis, Head of Public Affairs at Federation of Small Businesses said: “Cheques are vital to the way many people and organisations operate. With over 4 million cheques written each day, many small businesses will be disadvantaged if banks decide to scrap the cheque and there could be a big knock on effect on the economy.

A spokesperson from Which? said: “Which? opposes setting an end-date for phasing out cheques until there are cheap and safe alternatives in place for people who rely on them. Prematurely getting rid off cheques will make life very difficult for many of the most vulnerable, including the elderly, the housebound and those who don’t have access to the internet.”